Emphasis on the Commitment of the Real Estate Financier — SAMA — SA

Saudi Central Bank (SAMA)
43076847
Date: 1443/09/03
Attachments:

Circular

To Whom It May Concern,
Greetings,

Subject: Emphasis on the Obligations of the Real Estate Financier When Transferring Its Rights to Third Parties in the Secondary Market, and When Delegating Collection Tasks to a Third Party.

Based on the regulatory authorities vested in SAMA under relevant regulations, and in light of its supervisory and oversight role over real estate financiers, and based on the provisions of the Real Estate Financing System issued by Royal Decree No. (M/5) dated 13/8/1432H and its Executive Regulations,

SAMA confirms that refinancing through licensed real estate refinancing companies is limited to the trading of real estate financing contract rights in the secondary market - as stipulated in the Real Estate Financing System and its Executive Regulations -; and the real estate financier (the issuer of the financing contract) is not exempted from fulfilling its obligations under relevant regulations, contracts, and directives when transferring its rights. It remains committed to continuing the fulfillment of these obligations throughout the contract term, including but not limited to:

Prompt updating of any changes in clients' credit records, which must be done within the shortest period specified in the Executive Regulations of the Credit Information System.
Early settlement cases and debt rescheduling for clients in accordance with relevant directives.

Accordingly, the real estate financier is bound by this requirement, while enabling the third party to whom collection tasks are delegated to perform its duties (in accordance with applicable regulations and directives). Please note that SAMA will take regulatory measures if non-compliant practices are identified.

For your information and action.
Yours sincerely,

Fahd bin Ibrahim Al-Shari
Deputy Governor for Supervision

Distribution Scope:

Banks and financial institutions operating in the Kingdom.
Financing companies operating in the Kingdom.

P.O. Box 2992 Riyadh 11169, Kingdom of Saudi Arabia Tel: +966 11 463 3000 P.O. Box 2992, Riyadh 11169 Kingdom of Saudi Arabia Tel: +966 11 463 3000